As I engage with several entrepreneurs, one of the recurring realisations is that they have grand plans for their companies – but alas, it’s only in their heads! If I get a dollar for each time I have met entrepreneurs with no written business plan, I would be competing with Elon Musk right now. It is so easy to get consumed with the present-day operations that entrepreneurs tend to forget to plan for tomorrow. And do not get me wrong, I do understand the problem. Tomorrow exists only because of today! So, why focus on tomorrow’s events when today is doubtful? So, I do not advise entrepreneurs to sacrifice the present for the hope of the future. However, every entrepreneur must document their plan for the business.
Several would-be entrepreneurs also get carried away with writing a great business plan. They get bogged down putting together a thesis that nobody – including themselves – will ever read or refer to again. I am not advocating for this either. For new and smaller companies, a plan could be as simple as stating the company’s vision, how many years it will take to get there, and what will be done in each of those years to realise that vision – three years, five years, etc. But make the following year’s plan as actionable as possible, given that it’s impending. This exercise forces you to step back and think seriously about where you are going with your enterprise. It pushes you to ask critical questions about your business’s competitiveness and value proposition. As time progresses, it is not unusual to deviate from the plan due to new facts and evidence, but that has some utility. Once there is a deviation, the plan should be updated. It provides the entrepreneur clarity on the dynamics that changed the business plan and is forced to think of the expected outcome if different from the earlier planned result. This is useful because it keeps the entrepreneur honest about the business trajectory, the changing environment, and new business constraints and helps the business map a new course. This is called deliberate management. Several companies move with the flow. What happens when the flow stops? Your guess would be as good as mine – the business comes to a halt!
I am the author of Scaling for Success: Empowering African SMEs. I am a Partner at Sahel Capital, a food and agriculture-focused private investment firm in Sub-Saharan Africa. Sahel Capital manages the Fund for Agriculture Financing in Nigeria (FAFIN) and the Social Enterprise Fund for Agriculture in Africa (SEFAA).
I co-lead SEFAA, an impact-first fund investing in agribusinesses that provide direct or indirect benefits to smallholder farmers across 13 countries in Sub-Saharan Africa. I also lead investments and portfolio management for SEFAA and manage FAFIN portfolios, two of which were recently exited. I am a director on the board of one of the portfolio companies and serve in advisory roles for several startups and SMEs.